Acquired or Acq-hired, Xpenser Adds Expertise to Coupa’s Web Services

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if Darugar, who was previously a Yahoo director of architecture, was Coupa’s real acquisition target.

Xpenser’s Linkedin profile indicates the company has less than 10 employees. But Darugar would not disclose the exact headcount, which suggests to me that he is Xpenser. Another sign that Daruger is the deal: He says Xpenser will remain in Del Mar, instead of consolidating its operations with Coupa in San Francisco (like most of the other San Diego startups that get acquired by Bay Area companies). In fact, Darugar says he just closed on a bigger office near the Del Mar racetrack and thoroughbred club, “where the turf meets the surf.”

It also might be fortunate that Xpenser did not raise outside capital, as the presence of investors anticipating a big payout might have complicated the acquisition. Darugar says he invested “a pretty significant amount of my own money” to fund all of Xpenser’s operations over the past five years.

Instead of accepting Coupa’s buyout offer, Darugar says he could have spent “the next three to four years” continuing to grow Xpenser “pragmatically.” Xpenser’s revenue growth in 2012 “was better than 100 percent” over the previous year, Darugar says, and the startup’s customer retention has been “excellent.”

On the other hand, Coupa was founded two years before Xpenser, and Darugar says Coupa has reached a stage, “with an established sales force and fantastic enterprise customers,” which could still take Xpenser several years to attain. In his view, the deal makes Xpenser kind of a “startup within a startup.” As Darugar puts it, “we are part of this fast-growing Bay Area business that will be maintaining a local presence in San Diego, and we still get to live here and enjoy the lifestyle here.”

Moments later, he added, “When you control your own destiny, you can make the decisions you want to make.”